Workers’ Compensation and Ghost Policy

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What is a Workers’ Compensation policy?

For a better understanding of what a ghost policy is, let us first understand what a workers’ compensation insurance policy is. Workers’ compensation is a type of insurance policy that provides wage replacement and medical benefits to employees injured while doing their job. The employees in return will waive his rights to sue his or her employer for any form of negligence on their part. Workers compensation policy is primarily based on payroll and the type of risk of the contractor/company is exposed to.

What is a Ghost Policy?

A worker’s compensation ghost policy is a type of insurance policy where the owner is excluded and there is no other employee under the company’s payroll. It is referred to as a ghost policy because it technically does not provide any real coverage.

You may ask, so if there is no employee on payroll, why do I need to have a ghost policy?

Contractors or individuals normally purchase this ghost worker’s compensation policy because some general contractors and companies will not let a contractor on a jobsite without a certificate of insurance that shows Workers Compensation Insurance. For example, a subcontractor bids for a certain project and gets the job, the general contractor will require him to have this own worker ‘compensation policy. Unless you present them a certificate of insurance proving that you indeed carry such policy, you will not be allowed to start the job and may lose the project. This is to ensure that in the event where the subcontractor hires an employee, he will have some sort of coverage in place for the said employee.

Since workers’ compensation policy is based on payroll, it is a no brainer that the ghost policy is the most affordable type of workers’ compensation policy you can get in the market. You however need to make sure that every subcontractor you hire provides you a certificate of insurance that shows that they have Workers Compensation Insurance. If you fail to do this you will be charged for the amount you paid to that subcontractor under your workers compensation policy. This could be quite expensive.

List of states and Ghost Policy avaliability

For the list of states and ghost policy availability, please refer to the table below. For states where ghost policy is not available, we always have the option for you. Workers compensation ghost policy may not be an easy type of policy to find and not every insurance agent is willing to do the work for you. So, take advantage of our service and contact us for your insurance needs.

State

Availability

Alabama (AL)

Available

Alaska (AK)

Available

Arizona (AZ)

Available

Arkansas (AR)

Available

California (CA)

Not Available

Colorado (CO)

Not Available

Connecticut (CT)

Available

Delaware (DE)

Not Available

Florida (FL)

Available

Georgia (GA)

Available

Hawaii (HI)

Not Available

Idaho (ID)

Not Available

Illinois (IL)

Available

Indiana (IN)

Available

Iowa (IA)

Available

Kansas (KS)

Available

Kentucky (KY)

Not Available

Louisiana (LA)

Not Available

Maine (ME)

Not Available

Maryland (MD)

Not Available

Massachusetts (MA)

Not Available

Michigan (MI)

Not Available

Minnesota (MN)

Not Available

Mississippi (MS)

Available

Missouri (MO)

Available

Montana (MT)

Available

Nebraska (NE)

Available

Nevada (NV)

Available

New Hampshire (NH)

Available

New Jersey (NJ)

Not Available

New Mexico (NM)

Available

New York (NY)

Not Available

North Carolina (NC)

Not Available

North Dakota (ND)

Available

Ohio (OH)

Available

Oklahoma (OK)

Not Available

Oregon (OR)

Not Available

Pennsylvania (PA)

Not Available

Rhode Island (RI)

Not Available

South Carolina (SC)

Available

South Dakota (SD)

Available

Tennessee (TN)

Not Available

Texas (TX)

Not Available

Utah (UT)

Not Available

Vermont (VT)

Available

Virginia (VA)

Available

Washington (WA)

Available

Washington DC

Available

West Virginia (WV)

Available

Wisconsin (WI)

Not Available

Wyoming (WY)

Available

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